The State Of Commercial Real Estate, In Charts

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by Tyler Durden
Thursday, Feb 29, 2024 - 01:45 AM

One year after regional banks crashed and burned due to the combination of tumbling debt/treasury prices coupled with cratering commercial real estate loans, fears about the current state of Commercial Real Estate - where most offices still see tenants at best 3 to 4 days a week and are literally burning through rents - appear long forgotten. Is that sensible?

For one answer, we turned to the latest report from Goldman's REIT/CRE expert Chandhi Luthra who has published a visual assessment of the state of CRE in 2024 in terms of loan maturities, 2023 extensions, and property and lender groups. She also looks at the latest transaction and leasing volumes, and shares several key takeaways.

  • There are ~$4.7tn of outstanding commercial/multifamily mortgages outstanding, according to the Mortgage Bankers Association’s 2023 Commercial Real Estate Survey of Loan Maturity Volumes.
  • More specifically in 2024, $929bn of CRE mortgages are expected to mature, ~20% of ~$4.7tn total commercial mortgages outstanding. In terms of property type, multifamily and office account for ~27% and ~22% of commercial mortgage maturities in 2024 respectively. In terms of lender type, banks hold ~47% of debt maturing in 2024, followed by CMBS at ~25%.